As the conflict in the Middle East continues, concerns are growing that rising liquefied natural gas (LNG) prices will increase energy costs for households this winter. An increase in international LNG prices could lead to higher gas and electricity rates, particularly impacting vulnerable groups such as the elderly and families with infants who find it difficult to reduce heating.
According to the energy sector on October 21, the prolonged conflict in the Middle East has heightened uncertainty in the international LNG market. The Japan Korea Marker (JKM), a key indicator for spot LNG prices in Asia, rose to the low $29 per MMBtu for December delivery as of October 16, up from the low $26 per MMBtu for November delivery a week earlier.
The supply and demand situation for LNG is a critical factor influencing winter energy costs. Rising international prices increase the cost of LNG imports, and any supply disruptions could make it challenging to secure necessary quantities. This is particularly concerning as a record El Niño is expected this winter, making stable supply essential.
Recent trends in natural gas sales indicate an increase in demand for heating. According to data released by Korea Gas Corporation on October 13, sales of natural gas for city gas reached 955,000 tons in September, a 4.8% increase compared to the same month last year. Additionally, total sales reached 3.875 million tons in December last year and 4.928 million tons in January this year, during a severe cold snap.
LNG is also used to generate electricity, which could further contribute to rising energy costs. Earlier, Korea Electric Power Corporation froze its fuel cost adjustment rate at 5 won per kWh for the fourth quarter. However, from a long-term perspective, rising LNG prices could increase generation costs, leading to higher electricity purchasing costs.
The issue is that this cost burden does not affect all households equally. Low-income households and elderly individuals living alone may struggle to reduce heating due to health or caregiving needs, making them particularly vulnerable to rising heating costs.
According to the National Data Agency's 2026 statistics on the elderly, the population aged 65 and older is projected to reach 11.125 million, accounting for 21.6% of the total population. With the elderly population exceeding one-fifth of the total, households with limited income may find it difficult to cut back on heating expenses during winter.
Moreover, the trend of increasing households with newborns is also notable. According to the agency's population trends report for July 2026, the number of births in July was 24,275, an 11.1% increase compared to the same month last year. The cumulative number of births from January to July this year reached 170,079, a 14.7% increase from the same period last year. Households with infants may face constraints in reducing heating to maintain indoor temperatures.
In summary, even if rising LNG prices do not directly translate into higher gas and electricity rates, prolonged supply instability could stimulate overall energy costs and inflation. There are calls for stable supply and practical support measures to ensure that vulnerable groups, who cannot easily reduce heating, do not bear the full burden of rising energy prices.
* This article has been translated by AI.
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